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CHAPTER 5
Canada’s Mixed Economy
What role does the free market play in Canada’s economic system?
Before READING
Making Connections
Look at the products you bring
to school (clothes, notebooks,
pens, pencils, or calculators).
With a partner, discuss where
the products are made. What
materials are they made of?
Where do those materials
come from?
WORD
S MATTER
mixed economy an economy that
combines different economic
systems, such as the market and
command systems
G 90
re you an avid shopper, or do you just buy something when
you need it? Do you pay full price for what you need, or do
you look for bargains? No matter what your shopping habits,
you are a consumer—a driving force behind Canada’s economy. The
market brings together sellers and buyers to decide prices based on
supply and demand. Sometimes the supply is greater than the demand
for a product, and it will likely go on sale. Other times the demand is
greater than the supply. In this case, the price of the product may rise.
Governments enter the economy by promoting growth and setting
the minimum wage. They also pass laws to regulate commerce and
protect consumers. Governments collect taxes and spend heavily.
They even own and operate huge companies, such as VIA Rail and
Hydro One. Like many countries, Canada combines the market and
command systems in a mixed economy. In this chapter you will be
investigating the mixed economy as part of the unit’s Big Idea: How
do economic systems influence industries across Canada and
the world?
A
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Why is government such an important part of Canada’s
economic system?
Questions to Consider
as You Read this Chapter
• How does the mixed economy work
in Canada?
• What are the three different types
of industry?
• How has technology changed industry
in the past century?
• How do I research and communicate
information about an industry?
• How do I interpret a map of industrial
location factors?
Literacy
Thinking About
Comparing Information and Finding Ideas
Create charts to compare economies and
industries as you read this chapter. Use headings
and subheadings to choose topics for your chart,
like the example below. As you read the chapter,
include your ideas on the importance and meaning
of the topics.
Mixed Economy
Traditional
and Market
Traditional
crafts sold
to tourists
Traditional
and
Command
Market and
Command
Importance/
Meaning
People in
this country
have
learned to
earn money
from their
traditional
ways
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Mixed Economies: A Closer Look
You just picked out a snack at the variety store. At the cash register,
your 99¢ item suddenly jumped to $1.12 with the addition of two
government sales taxes. Welcome to Canada’s mixed economy!
Canada is not the only country with a mixed system. In fact, most
nations today have some combination of the basic types: traditional,
market, and command. Mixed economies are everywhere.
Traditional and Market: Around the world, you will find
traditional economies that also have marketplaces in which goods are
offered by vendors. Services such as local taxis or repair work are also
available to those who can afford them. Also, traditional craftspeople
make many different handicrafts to sell directly to tourists or for
export. Fair trade goods are increasingly popular with Canadian
consumers.
During READING
Checkpoint
Check pages S 12–S 13 to review
analyzing photos. What do you
see in these pictures? What
clues can you use to answer the
question in the caption?
Traditional and Command: Among the five communist
governments that remain today are four Asian nations: China, North
Korea, Vietnam, and Laos. Many people in these countries rely on
subsistence agriculture. It would be very difficult for these
governments to successfully change traditional farming methods
adapted to the land.
Market and Command: There are no longer any “true” market
economies in the world. Even the best examples of the free market—
the United States, Taiwan, and Singapore—have some degree of
government regulation of business. At the other end of the scale, some
European countries like Sweden and Norway have market economies
with a great deal of government planning and taxation.
How can you tell which type of mixed economy is best represented in each of these photos?
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Canada’s Mixed Economy
Business, government, and consumers all play a part in Canada’s
economy. Every day, news headlines show the important role each
group takes in our mixed system. All three have the power to
influence the production and consumption of goods and services.
Ontario Government to Close Coal-Fired Plants
Telus Corporation Eyes Bell Canada for Merger
Imperial Oil Bids on Arctic Natural Gas
Police Probe Store Open on Holiday
Consumer Group Claims Gasoline Overpriced
Which of these news headlines
show the actions of a) business,
b) government, and c) consumers?
Governments Tax and Spend
All levels of government in Canada affect the economy because they
tax and spend. You may not pay income taxes yet, but you contribute
to government revenue every time you pay the GST (Goods and
Services Tax) and the PST (Provincial Sales Tax) on purchases. The
federal government in Ottawa collected more than $220 billion in
2006 from all sources. Ottawa then chooses how to spend this money
for the benefit of Canadians and the world.
WORD
S MATTER
revenue the amount of money a
company or government receives
as income
Revenue Collected by Canadian Federal Government (2006)
Personal Income Tax
$103.7 billion
GST (Goods and Services Tax)
$33.0 billion
Corporate Income Tax
$32.0 billion
Other revenues and earnings (e.g., VIA Rail)
$19.6 billion
Taxes on imports, energy, tobacco, alcohol
$17.7 billion
Contribution to Employment Insurance plan
$16.5 billion
How does government revenue collection affect you?
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Spending by Canadian Federal Government (2006)
Program expenses (e.g., defence, public
safety) $56.9 billion
Transfers to persons (e.g., old age security)
$55.6 billion
Transfers to provinces (e.g., health care)
$41.0 billion
Interest payments on the national debt
$33.8 billion
Other transfers (e.g., foreign aid)
$24.9 billion
Paying down the national debt
$13.2 billion
How does government spending affect you?
WORD
S MATTER
consumer a person or
organization that purchases and
uses products or services
consumer advocate a group or
person who protects consumers
from fraud, inferior products, false
advertising, etc.
Consumer and Producer Groups
Did you ever buy something that didn’t work? Was there anything
you could do about it? Consumer groups in Canada represent the
interests of consumers, which includes protecting them from inferior
products. At the same time, there are producer groups that look after
the interests of sellers. Both meet with governments to influence
regulations affecting the economy.
Consumer Groups
WEB LINK •
Learn about consumer rights in
Canada. Visit our Web site.
G 94
Buyers take a direct interest in the quality, safety, and value of
products and services as consumer advocates. Organized groups,
like the Consumers’ Association of Canada (CAC) and the Canadian
Toy Testing Council, are more than 50 years old. The CAC tackles
food and health issues, as well as product standards and prices.
For example, they monitor gas prices, and call for government
investigation if prices are too high. The Toy Testing Council tests toys
every year and rates them in an annual Toy Report. Consumer groups
have also pushed CD and video companies to post Parental Advisories
on their music and game products. Consumer groups influence the
marketplace in Canada’s mixed economy.
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Producer Groups
Farmers and other producers have organized marketing boards to
improve product quality while ensuring the income of their members.
Suppose farmers brought huge quantities of eggs or milk to market at
the same time. They would receive very low prices because of the
oversupply of their product. To help prevent this problem, marketing
boards organize farmers to regulate the production of their goods.
This creates a fairly even supply, which helps stabilize prices. They
also use advertising to inform consumers about farm products and to
protect the interests of Canadian farmers.
WORD
S MATTER
marketing board an organization
created by producers to promote
their product and to maintain fair
prices by controlling supply
WEB LINK •
For links to producer groups visit our
Web site.
Every year, the Dairy Farmers of Canada publish the Milk Calendar, which is distributed
free in print and online. Recipes inside the calendar are centred on milk products and
are based on Canada’s Food Guide. How is this effective advertising?
THINKING It Over
1. What is a mixed economy? Answer the caption
question found with the photos of mixed economy
combinations on page G 92. k t
2. Examine the two loonies showing Ottawa’s revenue
and spending on pages G 93 and G 94. t
a) Identify one fact from each diagram that you
found most surprising. Explain why.
b) Use examples from your community to explain
why government taxing and spending are so
important in Canada’s economic system.
3. Based on the two loonies, construct circle graphs of
your weekly or monthly revenue and spending.
How might this graph be useful to you? c a
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Three Types of Industry
WORD
S MATTER
industry work that provides
income for people
During READING
Making Connections
Think about where you live. Do
you have factories, resources,
or tourism in your area? If you
have more than one, which one
is most important to your area?
Discuss with a partner.
Everyday life can be very different in various parts of the world.
While you are in school, or perhaps spending part of your day helping
out in the family business, other young people are working many
hours a day. Girls your age are knotting handwoven carpets. Young
boys must sometimes work in dangerous conditions in factories.
In Canada, most people work in service occupations—for example,
electricians, ski instructors, and fashion designers. Education and
training are very important in service-based economies.
Most people think of industry and manufacturing as two words
for the same thing. To geographers, industry is any type of work
people do to make money. Carpetmaking and metalworking are
industries—they manufacture products. Teaching and designing are
also industries—they provide services. If a ski instructor is giving a
lesson, that’s industry. When she skis on her day off, her skiing is
leisure, not work. There are three types of industry:
• Primary industry is work based on harvesting natural resources,
such as animals, crops, trees, or minerals.
• Secondary industry makes commercial products from these
resources, through manufacturing or construction. • Tertiary industry provides personal, social, and commercial
services, as well as transportation and public utilities. Canada: Employment by Industry, 1941–2006
100
Percent of employment
With a compound bar graph,
the bar segments are
stacked one on top of the
other for a particular year.
It is a useful way to see
overall changes in detailed
information.
Primary
Secondary
Tertiary
80
60
40
20
0
1941
1961
1981
2001
2006
Year
Describe the pattern of changes in Canada’s industrial employment shown in this graph.
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Primary Industry
In Grade 7 Geography you learned about Canada’s natural resources
and the industries that process them. You might think that these
industries make up a large part of the Canadian economy. However,
you might be surprised to know that farm, fish, forest, and mineral
production accounts for less than 6% of the total value of Canadian
goods and services. Only about 1 Canadian employee in 25 works in
these activities. Farming, fishing, forestry, and mining are called
primary industries because each one gathers natural resources, the
first stage of industrial production. Use this chart to learn the main
characteristics of the four primary industries.
Farms
Forests
• cultivating, planting, and harvesting
crops, raising livestock and farming
specialized products such as honey
or nursery plants
• cleaning and packaging fruit and
vegetables and other products
• harvesting trees for manufacturing or
retail sale, as well as planting
seedlings
• includes sawmills, which make
building materials (cut lumber and
plywood) for construction
Fish
Minerals and Fossil Fuels
• catching, cleaning, and packaging
fish and all varieties of shell fish, such
as lobsters or clams, from the wild or
from aquaculture
• processing may be done on “factory
ships”
• extracting any type of mineral from
the earth, from diamonds to gravel,
along with petroleum and natural gas
• includes any refining which purifies
minerals before use in manufacturing
Our
Environment
Environment and Industry
All primary industry takes
natural resources directly
from the earth. Producers
must harvest a sustainable
yield, leaving plenty for future
use. They must also prevent
damage to the environment
through pollution or waste.
Poor farm practices, over­
fishing, clear-cut logging, and
poisonous mine wastes are all
environmental threats.
Create a poster to increase
awareness of environmental
threats in one primary
industry.
WORD
S MATTER
sustainable yield the amount
that can be taken from a natural
resource (e.g., cod stocks)
without reducing the resource’s
ability to maintain itself
primary industry the collecting of
raw materials for use in industry
Industry Combinations
Sometimes primary industry may combine with another type of
economic activity. Clovermead Apiaries, near Aylmer, Ontario, has
been owned and operated by the Hiemstra family
since 1975. Besides producing honey, they have
also created a small pioneer village on their farm
that attracts school groups and tourists. Special
festivals related to honey production and a
country store round out the Clovermead operation.
Tourism, education, and retail sales are all
services, and examples of tertiary industry. The
Hiemstra family business is a combination of
industry types.
The annual “bee-beard” competition at Clovermead
Apiaries attracts many visitors. Don’t try this at home!
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Secondary Industry
1. Inputs
Manufacturing
4.
System
Feedback
2.
Process
3. Ouput
WORD
S MATTER
input the first stage of the
manufacturing system, in which
decisions are made
process the second stage of
manufacturing, in which the
product is made
offshore companies foreign firms
that supply goods and services
for export to companies in other
countries, such as Canada
output the third stage of
manufacturing, in which products
are distributed to customers
feedback the last stage of
manufacturing, in which the
product and process are judged
secondary industry
manufacturing and construction
activities
WEB LINK •
Explore an interesting Web site about
jeans—history, production, and ads.
Visit our Web site.
G 98
If you play or watch sports, you know that a good team uses winning
strategies. Before games, players practise strategies. Afterward, the
coach reviews what worked and what didn’t. Manufacturing follows
a similar system. Input and process steps are like the game plan,
while output and feedback stages are like the game results. Use the
information about the clothing industry on this page, and the Zoom In
feature about the automobile industry on pages G 104–G 105 to
understand more about secondary industry.
Fashion: Input and Process
The manufacturing game plan calls for a new line of clothing. First,
several important imputs are required. Company designers study the
latest fashion trends before creating their own designs. Suitable
fabrics, leather, buttons, and thread are purchased from suppliers.
Pattern templates for the cutters to use are prepared in every clothing
size. The process of actually making the clothing differs from
company to company. Some use mass production methods in order to
sell inexpensive garments, while others focus on quality, perhaps
having one skilled sewing machine operator produce an entire outfit.
Some produce the goods locally, while others use offshore
companies, such as garment manufacturers in Mauritius or China.
The choice to use off-shore companies is usually made because of
lower labour costs.
Fashion: Output and Feedback
Clothing manufacturers employ sellers who arrange contracts with
stores. If the store buyers like the new products, they place big orders.
As a result, manufacturing output is large, and extra labour is hired to
increase production. On the other hand, the designers may have
misjudged consumer tastes. Fewer sales contracts result in lower
manufacturing output for the season. The volume of sales provides
company management with important feedback. After discussions
with the store buyers, managers may reward successful fashion
designers, and let others go. This feedback will help the company
have a better game plan for next season. Manufacturers are like
coaches—they don’t like to lose.
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Industrial Factors in the Fashion Industry
Montréal and Toronto are Canada’s most important fashion design
and manufacturing centres. Industrial factors such as raw materials,
labour force, and markets explain why the clothing industry is located
in these places.
During READING
Checkpoint
Create a chart to organize your
notes on the fashion industry.
Add your ideas on how input,
process, output, and feedback
relate to the primary,
secondary, and tertiary aspects
surrounding the fashion
industry.
WEB LINK •
Learn about Toronto’s fashion
industry at our Web site.
Inputs: Raw Material
Montréal and Toronto are well situated to receive shipments of fabric, leather, and other
materials. Highways speed the movement of container freight shipments from around
the world. Care must be taken so that the materials do not become damp or musty in
transit or storage. Why are quality materials so important in the garment industry?
Process: Labour Force
Canada’s two largest cities are leading garment centres based
on a large, skilled workforce. Many fabric cutters and sewing
machine operators have been immigrant women. Colleges in
both cities train designers. What skills would a successful
fashion designer require?
Output and Feedback: Market
The large populations of Montréal, Vancouver, and Toronto
make them the consumer base of Canada’s garment market.
Fashion shows are used to present the new lines to store
buyers, and their response shapes the production volume for
the season. Why do international designs usually get their first
Canadian showings in Montréal and Toronto?
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Tertiary Industry
Making a guitar: secondary
industry. Selling a guitar: tertiary
industry. Teaching guitar players:
tertiary industry.
WORD
S MATTER
tertiary industry the providing
of services, such as customer
support, distribution, or retailing
outsourcing sending work to an
outside provider, usually to cut
costs
The store buyers and models at a fashion show are not producing
anything; instead, they are buying and selling the finished products.
People behind the scenes are providing services too—truck drivers,
stage technicians, advertisers, and caterers. This is different from the
designers and machine operators who actually turned the cloth into
clothing. In Canada, there are about four service workers for every
manufacturing job. All developed countries have economies heavily
based on tertiary industries.
Now look at tertiary industry in daily life. Do you ride a bus to
school? If so, that is tertiary industry: transportation. After school,
you might have a guitar lesson, or buy milk, or mail a letter. All
personal and commercial services are tertiary industries, as are
communications activities like the mail system. It is not hard to
understand why about three-quarters of all Canadian employees work
in tertiary industries.
A recent trend in tertiary industries is outsourcing. Companies
that offer services such as accounting or computer support are hired
by companies in other countries. Often it is cheaper for companies to
outsource these tasks, rather than have their own employees deal
with them. How can this affect Canada’s tertiary industry? Why is
outsourcing often a concern for Canadian employees?
Tertiary Industry in Canada, 2006
Category
Value in Canada’s Economy, 2006
Value (% of GDP)
Industry Category
Value (% of GDP)
Finance, insurance, real estate
19.2%
Primary Industry
Education, health, social services,
government
15.5%
Seconday Industry
22.0%
Tertiary Industry
72.2%
Retail and wholesale trade
12.8%
Professional, scientific, and
technical services
4.5%
Information and cultural services
4.1%
G 100
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5.8%
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The Multiplier Effect
Some communities in Canada have economies based almost entirely
on tertiary industry. These are tourist centres such as Niagara Falls,
Whistler, and Peggy’s Cove. They have a high proportion of businesses
offering tours and activities, food and lodging, shopping, and
souvenirs. Tourists bring money, and the tourism businesses circulate
the money through the local economy. Business owners and their
employees then use their profits or wages to pay for food, clothing,
and shelter. Geographers call this the multiplier effect. It occurs in
every type of community. Many communities seek manufacturing
opportunities because this also results in a high multiplier effect—it
promotes other manufacturing and more services. Local economies
also prosper when resource industries sell their grain, fish, wood, or
minerals.
g
(e.
res,
. sto
.
(e.g
WORD
S MATTER
multiplier effect the effects of
spending in a local economy
Outsiders buy local
resources, products,
or services
offices)
$
ng, tourism)
farmi
$
$
$
$
$
$
$
Local resources,
products, and services
Loca
$
$
l employers and workers
Local b
usinesses and services
$
spending
How is the multiplier effect like throwing a stone into a pool of water?
THINKING IT OVER
THINKING It Over
1. Classify each of these activities as primary,
secondary, tertiary, or non-economic. Explain your
choices. a) delivering newspapers, b) making steel
rods for the construction industry, c) working on a
ranch, d) fishing with friends, e) making woven
carpets, f) babysitting for neighbours. k
2. Fashion moves across Canada from Toronto and
Montréal. List examples of goods and services that
flow into these two cities from each region of
Canada (e.g., oil from Alberta). k
3. Apply the terms input, process, output, and
feedback to an industry such as building
construction in an isolated First Nations
community. k a
4. a) Explain the multiplier effect in your own
words. k
b) How can the multiplier effect change a
region? Discuss how discoveries of precious
minerals, such as diamonds, affect Canada’s
North. k a
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GEO SKILL
Interpreting Industrial Location
from Maps
Area Symbols
urban area
The Chrysler Corporation operates a huge auto assembly plant in Brampton,
in the Greater Toronto Area (GTA). Here you will learn to interpret the
location factors for this industry from topographic and road maps.
wooded area
Line Symbols
180
elevation contour
stream
Step 1
Review the Meaning of the Map Symbols
You will need to know how to interpret area, line, and point symbols,
particularly those used on a topographic map. Use Chapter 1 to review
topographic map reading skills.
railway track
power line
407
divided highway
major street
Point Symbols
large buildings
Step 2
Locate the Industry on the Maps
You can spot the assembly plant on the topographic map as a large threepart building near the northeast edge of the Brampton urban area. Find this
place on the road map.
Step 3
Find Industrial Location Information on the Maps
• Flat land: a large area with few contour lines (for buildings and
completed cars)
• Raw materials: expressways to bring auto parts to the plant in transport
trucks
• Labour supply: a large population of workers in the surrounding region
• Market: a large population of customers in the surrounding GTA region,
and railway tracks to transport cars to more distant customers
Step 4
Make a Sketch Map
A sketch map is a simple hand-drawn map that shows only certain details
related to a topic. Use the topographic map to make a sketch map which
shows only the industrial location factors for the industry. Start with a
blank page and follow the steps found in “Using and Making Maps” on
pages S 14–S 15 of the Skills Tool Kit.
G 102
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N
Legend
Multi-lane divided
highway
21
0
0
22
7
Main road
19
Other road
0
Power transmission
lines
0
20
Brampton
Chrysler
Assembly
Plant
180
Railway line
407
Contours
180
Elevation in metres
River
Bramalea
Building
Large built-up area
0
.5
1 km
Wooded area
1 : 50 000
407
N
Brampton
Chrysler
Assembly
Plant
400
401
407
Bramalea
427
410
409
Brampton
TORONTO
407
427
Mississauga
0
2.5
5 km
401
403
Lake Ontario
APPLY It
1. Use the maps to record the industrial location information listed in
Step Three for the Brampton assembly plant. m
2. Make a simple labelled sketch map to show this location information. m
3. Vehicles are carried from Ontario across Canada by truck or rail. Give
examples of raw materials that reach Ontario from specific provinces by
a) ship, b) rail, c) transport truck, and d) pipeline. k
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pton
Building Chryslers in Bram
Z O O M IN
CA SE ST UD Y
The automobile industry is one of the leading
manufacturing activities in Canada. Motor vehicles
and parts are Canada’s leading export products,
greater in value than wheat, lumber, or minerals.
The industry is concentrated in southern Ontario,
where it has a tremendous effect on the economy
of the region. More than a quarter of Ontario’s
manufacturing employees work in some phase
of the auto industry, either producing auto parts
or assembling the actual vehicles.
Brampton Assembly Plant: Facts and Figures (2006)
Floor area: 278 711 m2 (the size of 40 football fields!)
Production: 968 vehicles per day (two shifts)
Employment: 3 500 people
Robotics: 507 robots
Economic Resources
Vehicle Assembly Plants
A
B
C
D
E
F
G
H
I
Company
Location
Chrysler Canada
Ford Canada
Cami Automotive
Toyota Canada
Toyota Canada
Chrysler Canada
Honda Canada
Ford Canada
GM Canada
Windsor
St. Thomas
Ingersoll
Woodstock
Cambridge
Brampton
Alliston
Oakville
Oshawa
N
G
400
TORONTO
ONTARIO
F
E
D
e
Lak
H
I
401
o
tari
On
403
C
B
U.S.A.
401
U.S.A.
A
Lake Erie
0
Where are automobile assembly plants located? Why?
The Brampton Chrysler assembly plant
G 104
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30
60 km
Chrysler Canada was formed in 1925. Today,
Chrysler Canada operates two major assembly plants
in southern Ontario, one in Windsor, and the other in
Brampton. The Brampton plant was built in 1986.
It produces the Chrysler 300 and Dodge Magnum
sedans for the North American market.
The Brampton assembly plant is huge—more than
half a kilometre wide! However, this factory does not
make any parts. Instead, car parts manufactured in
communities all across southern Ontario (and some
in the United States), are assembled into completed
cars. Brampton is an excellent site for an assembly
plant for several reasons. A large supply of trained
labour is available in the Greater Toronto Area, as
well as land and capital resources. And as you have
seen, the plant is well located in relation to
transportation routes. (See page G 103.)
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Input and Process
Output and Feedback
Chrysler has a reputation for progressive designs
from their high-tech Design Institute in Detroit,
Michigan. Like the fashion industry, new ideas are
featured at international auto shows to test public
reaction—the input stage of manufacturing. The
process stage uses the assembly line. Three separate
lines begin moving in different areas of the plant:
the engine, chassis (or frame), and body lines. When
both the engine and chassis are complete, powerful
robotic arms fit the engine into the chassis. Later,
other robots lower the completed body onto the
chassis. Painting, upholstery, glass, tires, and trim
are all added along the continuously moving final
assembly line.
A new vehicle rolls off final assembly every few
minutes. This output is distributed to Chrysler
dealers in two ways. Delivery within a few hundred
kilometres is completed using trucks with open
trailers that can each carry ten cars. They are a
common sight along Highways 407 and 401. More
distant delivery uses covered triple-stack railway
units, specially designed for the purpose. Consumer
feedback is all-important. The popularity of the
retro-styled Dodge Charger led Chrysler to develop a
similar concept car, the Dodge Challenger. It drew
rave reviews and is scheduled for production at the
Brampton plant in 2008.
WORD
S MATTER
robotics mechanical arms which can repeat simple operations
over and over with precision.
THINKING It Over
1. Suggest why robotics are used to a) combine
the three assembly lines, b) paint car bodies,
c) install windshields. t
2. With a partner, make a chart to compare
the manufacturing systems for clothing and
cars. Consider both similarities and differences.
In what other ways might technology affect industry in the
future?
k t
3. All of Canada’s major vehicle assembly plants
are in Ontario. Explain why. Then, look at
atlas maps to identify why certain resources or
goods are produced in a) British Columbia,
b) the Prairies, c) the North, and d) the Atlantic
region. k m
Chapter 5: Canada’s Mixed Economy
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Technological Change
WORD
S MATTER
technology the application of
mechanical arts and sciences to
producing goods and services
microchip a tiny integrated
circuit on which computer
technology relies
high technology equipment and
methods based upon computers,
robotics, and space researcg
During READING
Checkpoint
Create a new chart for this
section. Use the three economic
eras for your column headings.
Would you rather have a cellphone or a land line? An iPod or a
portable radio? A laptop or a desktop PC? If you picked the cellphone,
iPod, and laptop, it’s probably because they are smaller and more
portable than the other choices. They also use more advanced
technology. Twenty-five years ago, people would have been happy
with the choices you rejected, because the cellphone, iPod, and laptop
were not yet available to consumers. The electronic systems that
operate them had just entered the marketplace in the Commodore 64
computer. The age of cheap microchip circuits was only beginning
in the early 1980s.
Economist Nuala Beck identifies three stages in Canada’s
economic and industrial development, each with its own technology.
The Commodity Economy lasted until 1918, and relied on coal
for energy and steel production. Next was the Mass-Manufacturing
Economy, with wide-scale secondary industry based on cheap
supplies of petroleum. Beck believes Canada entered its third
economic stage in 1981, what she calls the Technology Economy.
It continues today, driven by inexpensive microchips, computers, and
the telecommunications industry. You live in an era with technology
that was not available when your parents and grandparents were
young.
New technology changes the equipment and methods that society
uses to gather and process natural resources. In the past hundred
years, Canada and the other developed countries have moved quickly
from steam engines to computers. New machines and methods have
made it possible to produce more goods using fewer people. High
technology is being applied to most types of industry. For example,
computer-assisted design (CAD) and robotic assembly have become
vital parts of the automobile industry. Even the vehicles themselves
are controlled by internal computer systems.
Canada’s Economic Eras
Industrial
revolution begins
1750
G 106
Unit 2: World Economic Systems
Commodity Era
to 1918
1900
MassManufacturing
Era
1918 to 1981
1950
Technology Era
1981 to present
2000
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New Technologies Change Primary Industry
Computerized Mining
Mining takes place throughout
Canada, but three-quarters of
Canada’s metallic mineral production
happens in Ontario, British Columbia,
Saskatchewan, and Québec. In some
Canadian mines, underground
equipment is controlled by operators
on the surface. Watching television
monitors, they control mining
equipment using joysticks. Inside the
mine, an operator watches over two
or three machines in one area.
Mining companies also use “virtual
reality” simulators to train workers.
Precision Farming
The majority of Canada’s grain
farming happens in the three prairie
provinces. On these large farms,
precision farming combines satellite
technology and computers. A yield
monitor and a global positioning unit
are attached to a combine. This
equipment records how much grain
is harvested from each part of the
field. Computer software then makes
a yield map, showing which areas
were most productive. This allows the
farmer to improve the soil with lime or
fertilizer only where needed.
High-Tech Forestry
Cut-to-Length (CTL) logging systems
are used to cut more than 30% of the
world’s wood. This technology is also
used in Canada’s foresty industries,
in such provinces as New Brunswick
and British Columbia. The harvester
machine grabs a tree and cuts it
at ground level. Then a sharp collar
strips off the branches before the
machine slices it to length. Then a
forwarder machine picks up and
piles the logs for removal.
Chapter 5: Canada’s Mixed Economy
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Technology and Tertiary Industry
Technology has increased production while reducing the need for
workers. This sounds like a recipe for unemployment, but that hasn’t
happened, because technology creates new jobs too. Skilled
technicians are needed to install and repair new high-tech equipment.
Increased production has also brought wealth to developed nations,
and living standards have risen a great deal. This has led to the rapid
growth of tertiary industry, as people use a wider range of services.
Internet use is a good measure of the level of technology available
in a society. The map below shows that developed nations dominate
the Internet.
World Internet Use
N
SWEDEN
GERMANY
RUSSIA
NETHERLANDS
UK
DENMARK
FRANCE
SWITZERLAND
CANADA
SOUTH
KOREA
JAPAN
CHINA
TAIWAN
U.S.A.
HONG KONG
MEXICO
ITALY
ISRAEL
UAE
VENEZUELA
SINGAPORE
PERU
BRAZIL
CHILE
AUSTRALIA
SOUTH AFRICA
NEW
ZEALAND
0
1500 3000 km
Internet providers
Per 10 000 people
Over 100
10 –100
1–10
Under 1
Internet bandwidth
Megabits per second (Mbps)
Over 5000
10 00– 5000
Under 100
With which countries does North America have the most Internet traffic? What does this
suggest about technology and living standards?
THINKING It Over
1. Work with a partner to make a chart comparing the
benefits and problems of each of the three new
technologies in the photos on page G 107. t c
2. How might technology change the economy of
Canada in the future? Consider a) production, b) jobs, c) living standard. t
G 108
Unit 2: World Economic Systems
3. In a small group, discuss the extent to which rapid
technological change has been a good thing or a
bad thing for the Canadian economy. Rate your
personal overall opinion on a scale from 1 (very
good) to 5 (very bad). k c
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PUTTING IT ALL TOGETHER
Canada has a mixed economy that combines
market and command characteristics. You
examined the importance of government,
business, and consumers in this system. You
also learned how three types of industry—
primary, secondary, and tertiary—operate
in this business environment. Finally, you saw
how much technology has changed Canadian
industry. These ideas were all part of the unit
question, How do economic systems influence
industries across Canada and the world?
After READING
Synthesize Information from the Chart
Consider the unit question. Using the information
from your charts (especially in the importance/
meaning column), write down what you know
about the factors that affect industries. Continue
adding to these notes as you read the last chapter
of this unit.
THINKING It Through
1. Choose one of the industries listed here as a research
topic. Carefully record four good primary and
secondary sources of information about your topic.
Use charts to support and organize your research. t
•
wheat farming in the Prairies
•
nickel mining in the North
•
salmon fishing in British Columbia
2. Prepare a map to show the location of the
industry in relation to raw materials, labour, and
markets. m
•
newsprint manufacturing in New Brunswick or
Northern Ontario
•
steel manufacturing in Ontario
3. Prepare an organized report describing the
characteristics of the industry. Answer the question:
Why has this industry been successful? Use chapter
vocabulary, and apply the concepts of input, process,
output, and feedback where you can. k c a
•
aerospace manufacturing in Québec
•
a major homebuilder in your local region
•
a major bank in your local region
•
a major retailer in your local region
Chapter 5: Canada’s Mixed Economy
G 109